Our Common Good

GlaxoSmithKline was socked with $3 billion in fines by US authorities over charges it marketed drugs for unauthorized uses, held back safety data, and cheated the government’s Medicaid program.

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GSK, one of the world’s largest health care and pharmaceuticals companies, pleaded guilty on three counts and agreed to the fines in what the department called the largest health care fraud settlement in US history.

The British drugmaker admitted to charges that it had promoted antidepressants Paxil and Wellbutrin for uses not approved for by US regulators, including treatment of children and adolescents.

The company also conceded charges that it held back data and made unsupported safety claims over its diabetes drug Avandia.

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And separately, GSK is being fined $300 million to settle charges it underpaid rebates it owed to the US Medicaid program.

On April 21, the 60 Plus Association, a front group that FireDogLake reported in 2009 is “almost fully funded by the pharmaceutical industry,” started running 60-second radio ads in 30 Congressional districts thanking Republicans for voting for House Budget Chairman Rep. Paul Ryan’s budget plan, which would phase out the current Medicare program completely for those under 55 years of age.

60 Plus president Jim Martin says it is “absolutely true” that Ryan’s plan will phase out Medicare for those under 55, but at the same time says, “at least [Ryan is] trying to save Medicare for the future.” The ads misleadingly state that Ryan’s plan will “protect Medicare and keep it secure for future retirees.” The group also misleadingly asserts that the GOP’s budget proposal, which will turn Medicare into a voucher system, will make “no changes for seniors on Medicare now or those who will soon go on it.” The ad campaign cost the 60-Plus Association $800,000.

Should a health care system be designed to ensure that patients receive appropriate medications that they should have to relieve symptoms or cure disease? Of course. Yet co-payments (a dollar amount) and coinsurance (a percentage of the cost) impose on the patient financial barriers to the medications – barriers which frequently are not surmounted, and thereby may result in impaired health outcomes.

With our fragmented system of financing health care those seeking greater profits will always find another way to achieve their goals. In this instance, the pharmaceutical manufacturers have found a way to reduce or eliminate these financial barriers to their products.

In providing cost-sharing assistance to the patient, the manufacturers are not specifically removing barriers to the most appropriate products, but rather are removing barriers to their most profitable products, irrespective of whether or not they are the best choice. Since these are more expensive products, that increases the drug costs of the private insurers. Those of us paying premiums to private insurers that cover drugs are paying for these excess costs.